Quarless: Gov’t making “a killing” on the petrol tax

NDC Caretaker for St Andrew South-west, Sylvester Quarless has charged that the ruling New National Party (NNP) government of Prime Minister Dr. Keith Mitchell is raking in millions from taxpayers from recent hikes in the Petroleum tax.

Appearing on Tuesday’s “To The Point” programme on GBN radio, Quarless referred to government’s recent petrol tax from $3 to $5 on every gallon of gas sold at service stations.

He said that over $50 million went into the coffers of the National Treasury straight from the disposable income of taxpayers in the country.

His comment came against government’s announcement about a gallon of gas falling at the pump by 20 cents, moving from $13.65 to $13.45 a gallon.

Quarless who operates a gas station in Grenville, St. Andrew provided figures to show that government had raked in over EC$50 million from taxpayers from the Petroleum tax.

He said that outside of GRENLEC, a major consumer of fuel for the generation of electricity, the population including the motoring public, fishermen, and persons cutting lawns and debushing purchased 6,993,572 gallons of gasoline in 2014.

“If you do the $5 petroleum tax on that (figure), government (is) raking in $34,967,860 in one year and that is only on gasoline,” he told the programme host.

According to Quarless, if the Mitchell administration had left the petroleum tax at $3, government would have earned just over $30 million from the tax.
The cash-strapped regime in St. George’s has been forced to increase taxes and government fees as part of a Structural Adjustment Programme to earn more revenue.

Quarless also pointed to an impending 50 cents increase in the Petroleum tax by the NNP regime which will generate an additional $5 million for government.

He accused the administration of “wrecking” the pockets of Grenadians with the additional 50 cents increase.

The NDC political activist pointed out that the price of petroleum at the pump went down by 20 cents on Tuesday but in reality it (is) supposed to go down by 70 cents.

He said government is now taking 50 cents out of the 70 cents and “they feel that we are so stupid and we don’t know”.

A release from the Ministry of Finance indicated that the increase on the petrol tax was necessary as government decided not to proceed with a second round of Property tax increases.

The release said: “Effective, October 18th, 2015, the Petrol Tax has been increased by fifty cents (50¢). This adjustment was necessary in light of Government’s decisions not to proceed with the second round of Property Tax increases and not to proceed with the introduction of the Financial Activities Tax (FAT). Both measures are provided for in the Letter of Intent (LOI) with the International Monetary Fund (IMF), signed in June 2014.

“As a consequence of these decisions not to proceed with the aforementioned tax measures, an alternative revenue measure had to be found to ensure fiscal targets are met going forward. To this end, Government increased the Petrol Tax in September and October 2015. No further increases in Petrol Tax are planned”.

Quarless also alluded to the millions that government was taking from taxpayers through the sale of diesel.

He said that Grenadians consumed 3,127,136 gallons of diesel in 2014 and using the increased $5 petroleum tax, government made over $15 million per year on the fuel.

“When you add that together, at the $5 Petroleum tax, government will be receiving $60,603,540 – that is the 2014 figures. It is alleged now, that there is an additional 50 cents again, so …. they will be making another $5 million,” he remarked.

Quarless noted that due to falling oil rates on the international market, the cost at the pumps in Grenada simple does not add up.

“So if you telling me now the price for fuel on the international market is less than $50 a barrel, so that means over the last year or so the price has dropped by close to $100 and you telling me you still at $13. If you do the Maths something is wrong here, the Maths not working out. If it drop by $100 and you telling me it move from $16 to $13, the Maths is not right,” the NDC Caretaker said.

Quarless also addressed the claim made by government officials that one of the reasons responsible for the high cost of fuel in Grenada is the cost to transport it to the island.

He said that most of the suppliers throughout the region receive from the same source as Grenada.

“For example in St Lucia, sometime it’s $2.50 cheaper for a gallon at the pump, St Vincent, sometimes a gallon is $2 cheaper and it’s coming from the same source, using the same ship. It means that the measures that are implemented in Grenada and which the consumer do not have control over is at the government level…”, he added.

According to Quarless, the Minister of Finance does not have to go to Parliament anymore to get authority to increase petrol prices.
He urged the Mitchell government to review the tax charged per gallon of petrol in the interest of the people.

“It’s very tough already economically on all fronts. The salary range (in Grenada) is much lower than in some of the OECS islands and income and disposal income for a lot of Grenadians is very depressed”, he said.

Quarless is suggesting that the NNP should look at alternative “ways and means” to raise revenue instead of imposing “$5.50 or the impending 50 cents now on top of the $5”.